I am embarrassingly uneducated about real estate, especially considering I have owned my condo for five years and rented a bedroom out for three of those. I'm considering a career downshift, which may or may not take me out of Manhattan. I'm trying to figure out how to evaluate my condo. This may all be a bit moot as it seems we're moving into a buyers' market here, but it's still a good thing for me to understand. I'm using arebelspy's case study items below:
Market Value: 630K (This is obviously approximate. Two ~identical units to mine have sold for this amount this year, but I"m not sure how much of those units' share of our assessment was paid off, if any. More on this below.)
Original Purchase price: 480K (in August 2013)
Original Mortgage One Amount: 384K PLUS 24K purchase money HELOC at a floating rate. I paid off that HELOC in pretty short order. Essentially I put 15% down in cash.
Interest Rate for Mortgage One: 4.25% fixed (1889 a month)
Mortgage Term for Mortgage One: 30 years
Term remaining on Mortgage One: 25 years
Amount remaining on Mortgage One: 348K
Original Mortgage Two Amount: In 2015 we needed a new roof and, very long story very short, we had a ~60K assessment. I cashflowed ~10K and got a 50K heloc in June 2015 at a floating rate
Interest Rate for Mortgage Two: Floating. Currently ~6.7%.
Mortgage Term for Mortgage One: Can draw down until June 2020
Term remaining on Mortgage One: N/A
Amount remaining on mortgage One: 1,600 (I've aggressively paid this off, and super aggressively since the tax reform)
Gross Rents: I live in it with husband and baby. Similar units probably rent for about $2700. ETA: I used to rent out the smaller bedroom for 1000 and could do that again pretty easily.
Principal and Interest (the P&I of your PITI - should match with the above info): Not sure what the relevant number is here. My insurance and property taxes add approximately $200 a month for a total of, I guess, 2089 (ignoring my HELOCs...).
Taxes and Insurance (the T&I of your PITI): $200
HOA costs: Condo fees (including water as there's no meter for individual units) are $708
Deferred maintenance notes: The building has a judgment against an awful contractor we'll never collect on (1.6 million plus years of interest). We had to replace the roof he messed up, but hopefully that's done now. In terms of unit-specific maintenance, I should paint and do some handyman items, but the unit is generally sound.
Anything else special or unique in regards to the numbers of the property (not the property itself; things such as city assessments, back taxes, special costs due to unique features of the property, etc. etc.): If I were to sell, I would be on the hook for a lot. Estimated costs to me as seller:
- broker at 6% (maybe $38K)
- NYC Real Property Transfer Tax of 1.425% (maybe 9K)
- [NYS Transfer Tax of 0.4% (maybe 2500)
- Attorney (3K)
- bank fees etc (2K)
- staging, clean up, etc (5K)
If I were evaluating this as a place to buy to start real estate investing, I would not have bought it. Even pre-MMM, going in to this purchase, I was pretty certain it wasn't the economically most ideal choice but consciously chose to buy anyway. I decided to anyway because: a. I was pretty certain it would benefit me to have a "forced" savings plan like this, b. I was bone tired of moving every 5-6 months from the time I was 16, and c. for emotional reasons as an orphan, I liked the idea of having a home base to invest in, etc.
I'm not sure how to evaluate this now that I'm already here. I don't have anything driving me out of Manhattan urgently, but I want to know how to figure the condo in to my decisions.
